Pioneer Energy Services (NYSE: PES) has amended its existing revolving credit facility. The new agreement provides Pioneer with a $350 million, five-year, senior secured revolving credit facility, which represents an increase of $100 million in total potential borrowing capacity over the company's previous facility.
The new agreement also provides a lower interest rate and extends the maturity date of the credit facility from June 30, 2016, to Sept. 22, 2019. Currently, the company has $40 million outstanding under the senior revolving credit facility, which includes a pay down of debt related to proceeds from the recent sale of the company's fishing and rental assets.
"This amended facility reduces our borrowing costs and increases our financial flexibility, as well as provides an opportunity to redeem the remaining $125 million of our existing 9.875% senior notes," said Stacy Locke, Pioneer's president and CEO. "We estimate that the benefit of the lower borrowing cost combined with the impact of redeeming our higher rate senior notes will reduce our annual interest expense by over $9 million."